SYNOPSIS

ON

CUSTOMER PREFERENCE TOWARDS

LAPTOP OF DELL, HP & LENOVO

UNDER THE GUIDANCE OF: SUBMITTED TO:

Mr. Gagandeep Singh Himanshu Chauhan

Lecturer MBA (Final)

GNIM Roll No.11067

GURU NANAK INSTITUTE OF MANAGEMENT

MULLANA (AMBALA)

DECLARATION

I hereby declare that the project titled “Consumer preference

towards the laptop of selected company”is the original pieceof work done

by me & the same has not been previously submitted toany university for

fulfillment of any course & that the project shall be liable to be rejected or

cancelled if found otherwise.

Place: HIMANSHU CHAUHAN

Dated:

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ACKNOWLEDGEMENT

Preservation, inspiration and motivation have always played a key

role in the success of any venture. In the present world of competition and

success, project work is like a bridge between theoretical and practical

working. Willingly I prepared this particular dissertation. First of all I

would like to thank the supreme power, the almighty god, who is obviously

the one who has always guided me to work on the right path of my life.

(HIMANSHU CHAUHAN)

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PREFACE

There is fast and rapid change in the security system industry

especially regarding the marketing practices of the various companies. The

preferences of the customers are fast changing.

Since the industry is fast expanding and its vast scope in the present,

the present study has been attempted to examine the marketing practices.

The study is an attempt to the highlight various technologies of security systems and hence the first chapter covers the introduction to the project. In second chapter there is description of company profile. The third chapter deals with the research methodology and hence various factors affecting customer, marketing practices of samples companies & their relative positioning Vs. the factors in analysis part are covered. However finally, the report covers the findings & recommendations for suitable marketing practices in industry.

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EXECUTIVE SUMMARY

COMPAQ, India’s premier information enabling and integration company

has received the ISO 9001:2000 certification specifies requirements for a

quality management system where an organization needs to demonstrate its

ability to consistently provide product and services that meets customer and

applicable regulatory requirements. ISO 9001:2000 also aims to enhance

customer satisfaction through the effective application of the system,

including processes for continual improvement of the system and the

TABLE OF CONTENTS Title Pg. No.

♦ EXECUTIVE SUMMARY 5 ♦ COMPANY PRIFILE 7♦ SCOPE OF THE STUDY 9♦ OBJECTIVE OF THE STUDY 10♦ RESEARCH METHODOLOGY 11♦ DATA ANALYSIS & GRAPHICAL INTERPRETATION 14♦ MAJOR PLAYERS IN THE MARKET 36♦ COMPETITORS OF COMPAQ 37♦ MARKETING STRATEGIES 41♦ FUTURE SCOPE 45♦ MARKET SHARE 47♦ MARKETING & SELLING STRATEGIES 48♦ CHANGING TRENDS 51

♦ DECISION MAKING PROCESS 57♦ SWOT ANALYSIS 59

♦ SUGGESTION & RECOMMENDATIONS 65 ♦ CONCLUSION 67♦ QUESTIONNAIRE 69

♦ BIBLIOGRAPHY 73

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assurance of conformity to customer and applicable regulatory

requirements.

The menu of COMPAQ global services broadly covers IT consulting and

professional services in the area of vertical applications, technology

integration, ERP implementation and software development. This also

includes a complete portfolio of systems and network services for

development. This also includes a complete portfolio of systems and

network services for Facilities Management, Helpdesks, Sysytems Supports

and network and Internet Implementation.

COMPAQ Insys’ global customers include Samsung, Government of

Singapore, and AMAL insurance Jurong Port in Singapore and Malaysian’s

BSN commercial bank, SIA, DBS bank, New bank life assurance charted

semiconductors.

COMPAQ Insys’ chosen platform of total technology integration lends

itself to some very significant alliances with the global leaders. Among its

partner are HP for high end AISCE/UNIX services and workstation and HP

Open view network management solution; Intel for PC and PC server

building blocks; Microsoft,novell and SCO AG solutions; Red hat ;Linux;

Samsung; Pivota for CRM solution and ORACLE Sybase and Informix for

RDBMS platform.

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Today the company has aligned its operations into five entities that offer

seamless linkages for the customers seeking entry into the wired world

through total the. ‘Integration solution ands services’.

COMPAQ focuses on the ever-growing segment in Imaging, Telecom and

Communication products solutions and services. Now it has an exclusive

sale and support partnership with Toshiba Corporation, Japan, for sales and

servicing of its imaging and photocopier products. COMPAQ product

portfolio covers a range of other office automation and communication

products through alliances with world leaders.

The Managed Network Service offerings for corporates include VPNs, ASP

offerings, Co Location/ hosting, CDNs, security, corporate internet

telephony solutions, technical and consumer help desks, 24/7 Network

Operations Centre monitoring and a host of value added networking

services. Consumer services include dialup PSTN/ISDN Internet access,

Valufon calling cards and VoIP telephony devices.

INTRODUCTION

Desktop computers usually come with a vertical chassis, referred to as a tower, which

typically sits on the floor under a desk. A monitor, keyboard, mouse and

speakers are all attached to the tower separately.

Laptop computers, on the other hand, are small, battery-powered, lightweight (1-

3 kg) and ideal for those who require portability, such as business people who travel or

university students who could then easily move from a dorm room to a library to a

lecture hall to a cafe. With a DVD player, laptops can also be used as portable

entertainment systems.

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Unlike a desktop setup, all accessories are integrated into the laptop (mouse,

keyboard, speakers, etc) but external ones may be attached, as well. The prices for these

accessories are about the same for both laptop and desktop PCs.

It should be mentioned that many of today's laptops come equipped with

integrated wireless networking features (like Intel Centrino mobile technology) so that

users can tap into a high-speed internet connection. The PC user must be in the range of

a compatible wireless network, known as a hotspot, which is available in some hotels,

airport lounges, school campuses, and cafes. Desktop computers usually come with a

wired network card, but wireless cards can be purchased.

THE GLOBAL LAPTOP INDUSTRY

A laptop computer is a small, portable computer that is small enough to sit on a

person’s lap. While the personal computer (PC) industry began in the early 1970’s, it

was not until 1981 that the first commercial portable computer - Osborne 1 - became

available. The next big event in the history of laptops came in the summer of 1995, after

which Microsoft and Intel became the standard for the software (Windows) and

hardware (Intel processors) used in laptops. Over the past fifteen years, the increasing

price-performance ratio, consumer preferences for mobility as well as increased

hardware life has resulted in higher growth of laptops than desktops since 2004.

Datamonitor forecasts that the global PC industry is projected to grow at a compound

annual growth rate (CAGR) of 5.4% in market value during 2007-2012, with laptops (a

sub-segment) being the major contributor to its growth. This growth is down from the

7.6% CAGR for 2003-2007, in part due to the slowing economy. In addition to the

economy, the laptop segment is expected to face increased competition from both new

devices and technologies. Smart phones (iPhone, Blackberry, Palm Pre) and Mobile

Internet Devices (Nokia N800 Tablet) are starting to compete with laptops due to

features such as gaming, internet access and enterprise applications. Changes in demand

and new technologies will continue to alter the outlook for the laptop industry in the

coming years.

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New demand for low cost ultraportable laptops – called netbooks – has created

new competitors like ASUSTek as well as forced companies to change their business

models to succeed. New technologies such as cloud computing and hosted virtual

desktops (HVDs) may change the requirements of the laptop industry, from powerful

stand-alone laptops to less-powerful wirelessly networked laptops. This will likely affect

the profitability of existing manufacturers. The focus in this analysis is therefore on the

macro- and micro- factors affecting the global laptop PC manufacturers. Since the laptop

industry represents a segment of the broader personal computer (PC) market, data

regarding the PC industry is also relevant in the analysis of the laptop industry.

Laptop sales in India have risen drastically, which accounts for over 25% of the

total personal computer market. Laptop sales only accounted for a 3% of the total

personal computer till 2003. The sales of the laptops has reached a mark of 0.68 million

unit in fiscal year 2006-2007 which accounts for a growth of 59% over the same period

in fiscal year 2005-2006. Sale of desktop computers and laptops has touched the mark of

8.5 million units in the fiscal year 2007-2008. There are various main players in the

Indian notebook market.

POLITICAL FACTORS

The laptop and PC industry is expected to grow at a faster rate in developing

countries compared to the developed countries. Therefore, changes in government

policies in developing countries like India and China can affect the potential growth

rates in their markets. For instance, the removal of import duties on laptops in India in

2005 was one of the factors that resulted in a growth of 94% in laptop sales in 2005.

Increasing focus on the environmental impact of high-tech trash has lead to more

stringent environmental regulations on the electronics industry such as the RoHS

(Restriction of Hazardous Substances) and WEEE (Waste Electrical and Electronic

Equipment) Directive. The additional testing and certification involved directly affect

the supply chains for laptop and PC manufacturers, resulting in increased costs. For

instance, in Canada, the enforcement of the WEEE Directive will increase the cost of

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computers by $15. The increase either affects the consumer or reduces profitability for

manufacturers.

ECONOMIC FACTORS

The global economy influences various different factors that affect the growth of

the PC industry. Since early 2008, the slowing global economy is one of the reasons for

the decrease in business capital spending for small and large corporations, resulting in

reduced demand for PCs. Gartner, Inc. forecasts a decline of 3.8% in global IT spending,

of which computing hardware spending is expected to decrease by 14.9% in 2009.

Though this decline in IT spending is likely to recover slowly during 2010, the global

PC market is expected to face declining growth rates in terms of market value, from an

expected 5.4% growth in 2009 to 4.1% in 2012. Most laptop (and PC) manufacturers

such as Dell, HP, Acer, Lenovo, and Apple generate sales throughout the world and

therefore currency exchange rates are an important factor as well. The strength (or

weakness) of the US dollar versus other currencies can directly affect a company’s

bottom line. The economies in developing countries such as China, India, Brazil, and

Latin America are growing at a much faster rate than developed countries and therefore

provide better growth opportunities for computer manufacturers, since developed

countries like the US and Japan have become saturated. This trend is reflected in the

slower single digit growth in the last few years as opposed to the consistent double digit

growth in the developing markets.

SOCIAL

Social factors such as education, preferences, income levels, and other cultural

factors influence demand patterns in the different regions and therefore affect how a

company operates in each region. The education and income level of users affects the

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brand perception of the computer manufacturers. Households with higher income have

higher percentages of Apple computers. Such households are also more likely able to

afford (and want) Apple computers. This has allowed Apple to continue its strategy of

premium pricing and performance compared to Windows PCs, while at the same time

increasing its market share of the total laptop and PC market. At the other end of the

education spectrum, new devices such as the rugged and ultraportable OLPC (One

Laptop Per Child) have been developed for underprivileged users in developing

countries like Africa. Thus, education levels affect both product demand as well as

preference. Cultural aspects of different regions affect the occurrence of seasonal sales,

which significantly affect the performance of the computer industry as a whole. For

instance, in the U.S., the periods from November-December (Thanksgiving / Christmas)

and August (back-to-school) are significant earnings period.

TECHNOLOGICAL

Technological advances over the past decade, such as increased processing

power with reduced power consumption and reduced cost, or the standardization of

Windows and Intel in laptops, are one of the main reasons for the increase in market

share of the laptop segment compared to the overall PC industry. For instance, the

notebook category’s average selling price (ASP) of $300 was made possible by the low

cost Intel Atom microprocessor, released in 2008. New technologies, such as hosted

virtual desktops (HVD), threaten to completely change the industry dynamic, due to the

possibility of cheaper computers along with lower software costs. HVDs involve

centralized computing in which the processing is done on servers instead of individual

clients. Gartner, Inc. estimates that the HVD market will grow in revenue from $1.3

billion in 2008 to $65.7 billion in 2013.

COMPETITORS AND INDUSTRY KEY FACTORS

The global PC market, including the laptop (portable) segment, is dominated

mainly by the five top competitors: Hewlett-Packard (HP), Dell, Acer, Lenovo and

Toshiba in descending order, and together they constitute approximately 60% of the total

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market share (based on units shipped). In the top 10, Apple has been gaining market

share compared to Windows PCs and laptops, mainly due to its positive brand

reputation. In terms of global PC volume, HP is the leader (18.9%, 2008) followed by

Dell (15.5%, 2008). Due to the netbook segment, Taiwanese companies such as

ASUSTek and MSI have increased their market share tremendously over the past two

years. In order to remain competitive, all of the top manufacturers share certain

characteristics, or key success factors (KSF). Efficient production and distribution

capability is one of these key success factors. Due to the reduction in ASPs of laptops

(and PCs), the industry is becoming more commoditized. Therefore the primary means

to reduce production costs lies in process improvement from procurement to production

and supply chain. This is possible by exploiting the benefits from mass production: more

bargaining with suppliers, better global distribution networks, cheaper production

facilities in foreign countries, etc.

Innovation and the ability to identify consumers’ needs are key success factors as

well. Moreover, the effect of these success factors has led to a consolidation in the

computer industry, with the largest firms becoming bigger. For instance, the top five

firms which represented 50% of the market share in 2007 now account for 60% in 2008.

Based on the key success factor analysis, the weighted competitive strengths

assessment shows that the future market will be dominated by HP, Dell and Acer. All of

the top firms in the table are pretty similar in strength, except for Apple. The lack of a

netbook category, premium pricing, small global share, and different operating system

results in Apple having the lowest score. The top Windows laptops have similar scores,

due to the commoditization of the industry. In the future, netbooks are forecasted to

grow to a market share of 30% of the global laptop industry by 2012. Netbooks have

affected the industry in two ways: a price reduction across all laptop categories and a

change in consumer preference. Consequently, ASPs for laptops decreased by 6.8% in

2007, 8% in 2008, and is forecasted to decrease by 12% in 2009. In addition, Gartner,

Inc. estimates global PC unit growth of 10% but only 4% growth in dollar value for

2009. Thus, the continuing long-term trend of decreasing profits in spite of increased

sales volume has forced companies to adjust their business models to maintain

profitability. For instance, Acer has announced a new line of netbooks and thin

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notebooks to maintain and increase profits in spite of decreased PC demand. Thus, PC

manufacturers will continue to have increased growth in the laptop segment, in part due

to the international market and netbooks, but will be faced with decreasing profit

margins. It is not clear whether the future demand for netbooks is sustainable and

therefore, in the long term manufacturers will have to adapt by increasing the focus on

the services segment.

OBJECTIVES OF THE STUDYOBJECTIVES OF THE STUDY

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The present study has also been taken up to fulfill some objectives. Thus the

objectives of the present study have been identified as follows:-

1. To study the need analysis of consumers preference regarding laptops.

2. To study the Marketing Mix regarding laptop.

3. To analyze the consumer’s decision-making process with due attention to factors

responsible for it

4. To know the brand loyalty among the consumer regarding laptop.

5. To find out the motivating factors for consumer in buying for a laptop.

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A large portion of society depends upon transportation and travel. Therefore the

relationship between the customers and the market players must be established and

explored to make the marketing effort fruitful and profitable. Thus, it is reflected in the

above wording that the present study will be useful in meeting and exploring the

proposed objectives. Therefore to make the present study meaningful the data shall be

collected from various sources such as journals, newspapers, Internet etc. that will serve

as the base for the secondary data and for interacting with the respective users of the

Laptop/Notebooks of different companies.

RESEARCH DESIGN

In the present study the exploratory-cum-descriptive research design will be

followed which will help in exploring the answers to the specified objectives of the

present study.

RESEARCH INSTRUMENTS

The proposed study will be based on both primary and secondary data. The main

sources of the secondary data to be used in the study shall be collected through

newspapers, magazines, journals, published reports of the industry (Laptops) players and

the internet.

For the primary data the customers shall be contacted with the questionnaire

designed to gather the data relevant with objective of the study.

SAMPLING PLAN For the purpose of gathering the primary data the customer numbering not more

than 100 shall be contacted with the help of a questionnaire. The sampling shall be

random and discrete.

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AREA FOR SAMPLING The areas, which will be considered for the purpose of present study, will be

Ambala & Mullana. Equal number of consumers shall be contacted for the purpose of

uniformity in results without a place for biasness in area or location.

ANALYSIS AND INTERPRETATION OF DATAThe data collected through questionnaire will be analyzed and interpreted with

the help of relevant statistical tools such as percentage, tabulation, charts, cross-

tabulation, correlation etc.

DATA ANALYSIS

& GRAPHICAL DATA INTERPRETATIOIN

SAMPLE SIZE : 55

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1. What type of computers do you use?

a.)Branded

b.)Assembled

Branded 37Assembled 18

hospitals using brandedcomputers

hospitals usingassembled computers

It was observed that almost 67% of the people use branded computers or

other gadgets for their business purpose. Hence can be concluded that more

people want branded products as they are not ready to compromise with the

quality and services being provided.

2. What brand of computers do you use?

a.) HP

b.) COMPAQ

c.) HCL

d.)Others

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Using branded computers

Using assembled computers

Brand used Total Nos.HP 7COMPAQ 14HCL 13Others 21

HP

HCL

acer

others

This observation showed that COMPAQ is among the top used brands.

Major part under the pie-chart goes to COMPAQ. So COMPAQ should

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continue making efforts to attract new market and sustain the existing

market.

3. What is the number of installed desktops?

a.) <15

b.) 15-50

c.) 50-75

d.) 75-200

e.) 200-500

Installed desktops Total Nos.< 15 1915-50 2150-75 1175-200 3200-500 1

Most of the surveyed and found the use of computers within the 15-55

range. So it can be inferred that the main target market is which lies in the

middle range. Thus we targeted mainly on SME (small and medium

enterprise).

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<15 15-5050-7575-200200-500

4. What is the number of used servers?

a. 1

b. 2

c. 3-5

d. 5

Servers used Total Nos.

1 10

2 11

3-5 21

>5 13

1

2

3 to 5

>5

From this observation, it was concluded that number of servers were

directly proportional to the number of desktops used.

5. What is the number of installed laptops?

a.) 1-5

20

b.) 5-15

c.) 15-30

d.) >30

Number of laptops Total Nos.1-5 205-15 2215-30 8>30 5

It was observed that maximum computers and laptop users ranging between

5-25. This area can be focused.

6. What is the brand used for laptops?

a.) COMPAQ

b.) Toshiba

1 to 55 to 1515 to 30>30

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c.) Lenovo

d.) Others

Observation showed that Toshiba was the major brand used in laptops.

Various other brands like HP and Samsung etc. are also used. COMPAQ

has also a good market share.

Laptops brand Total Nos.COMPAQ 11Toshiba 19Lenovo 13Others 12

HCL

Toshiba

lenovo

others

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9. What type of company is having the AMC?

a.)Regional office of the company

b.) Any other local player

Type of AMC company Total Nos.Authorized regional office 24Local players 6

regional office of thecompany

any local player

That the above graph shows that the use of AMCs in regional office and

local players prefers authorized regional offices to select for the service

rather than going for a local player.

10.Are you facing any problem with current used product line?

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a.)Yes

b.)No

c.)Not yet

Total Nos.ffacing problem 15nnot facing problem 18 nnot faced problems yet 22

That the above graph shows that the above observation showed that major

number of users are either not facing any problem or they have not being

encountered with any.

hospitals facing problem

hospitals not facingproblemnot yet encountered

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Facing problems

Not facing problems

Not yet encountered

11. Are you planning to make any new purchase?

a.) Yes

b.) No

c.) Not yet planned

Planning about new purchase Total Nos.Planning to purchase 9No planning 17Not yet planned 29

That the above graph show that the most of the users have not planned

about making a purchase and a very few are planning to make a buy.

planning to purchase

no planning

not yet planned

25

OK

good

satisfactory

outstanding

not tried yet

12. How do you find the COMPAQ products?

a.) OK

b.) Good

c.) Satisfactory

d.) Outstanding

e.) Not tried yet

Reaction about COMPAQ products Total Nos.OK 3Good 12Satisfactory 19Outstanding 7Not tried yet 10

According to above graph shows that the maximum of COMPAQ user are

satisfied with the products and services provided. Very few have not tried

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yet COMPAQ on a business scale, but most of them have an experience

about COMPAQ.

13.Do you want to know more about COMPAQ products?

a.)Yes

b.)No

Wanted knowledge about COMPAQ Total Nos.Yes 42No 13

That the above graph shows that the observation and the most of the people

are interested in knowing more about the brand and have the urge to buy.

want info about HCL

no info wanted

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14. Do you require demo for any product?

a.)Yes

b.)No

Total Nos.IInterested in demo 24NotNot interested in demo 31

hospitals interested indemo

hospitals not interestedin demo

This observation showed that almost 45% of the sample was interested in

demo.

15.Do you want to buy any product? (Commercial proposal)

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interested in demo

interested in demo

a.)Yes

b.)No

c.)Not yet decided

Commercial proposal Total Nos.Yes 8No 19Not yet decided 28

hospitals interested incommercial proposal

hospitals not interestedin commercial proposal

not yet planned

That the above graph shows that the above observation showed that almost

a huge chunk of hospitals surveyed either doesn’t want or they have not

planned for any commercial proposal.

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Interested in commercial proposal

Not interested in commercial proposal

Not yet planned

COMPAQ DELL IBM LENOVO APPLE HP ACER INTEX ZENITH SONY HCL SAHARA

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SAHARA COMPUTEREstablished in 1997 Sahara Computers assembles and markets

computers & peripherals through a global distribution network that covers

established and emerging markets. The company is owned by Sahara

Holdings, a fully Broad-Based Black Economic Empowered entity, and is

based in Johannesburg, South Africa. It is the official distributor and

Original Equipment Manufacturer (OEM) for a variety of top international

vendors.

An accredited member of the Proudly South African campaign, the

Sahara business network stretches across South Africa to include Cape

Town, Durban & Port Elizabeth. The company has established a strong

presence globally, with offices across EMEA, including Nairobi &

Mombassa in Kenya and Botswana, Dubai, the U.K and China.

Sahara Computers is currently the largest operation of its kind in

Southern Africa. Owned by Sahara Holdings group, company boast an

annual turnover over 1.4 billion Rand. Sahara Holdings strictly adheres to

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the principles of Broad-Based Economic Empowerment and established

itself among the frontrunners of empowered organizations within the ICT

sector when it confirmed its participation in an empowerment deal valued at

R640 million in 2006.

For the deal Sahara Holdings sold 27% of their shares to a newly

established consortium represented by mining and mineral resource Group

Mvelaphanda Holdings (Pty) Ltd. chaired by Tokyo Sexwale, and Afripalm

Consortium, a local investment company chaired by Lazarus Zim.

The deal incorporates subsidiaries and associates of Sahara Holdings

including Sahara Computers Pty Ltd., Sahara Systems Pty Ltd., Sahara

Consumables Pty Ltd., Sahara Distribution Pty Ltd. and Annex Distribution

Pty Ltd.

This venture signals a new era in the transference of the benefit and

value associated with technology, through to communities and individuals.

It also reinforces Sahara’s pledge to provide access to high quality,

affordable communication technology and infrastructure. It is the

competency and dynamic attribute of Sahara Computers that has won it the

confidence of many major IT suppliers, representing key product and

component ranges.

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Dell Inc. listens to customers and delivers innovative technology and

services they trust and value. Uniquely enabled by its direct business model,

Dell sells more systems globally than any computer company, placing it No.

25 on the Fortune 500. Dell's climb to market leadership is the result of a

persistent focus on delivering the best possible customer experience by

directly selling standards-based computing products and services. Revenue

for the last four quarters totaled $57.9 billion and the company employs

approximately 78,700 team members around the globe.

Dell was founded in 1984 by Michael Dell, the longest-tenured

executive to lead a company in the computer industry. The company is

based on a simple concept: by selling computer systems directly to

customers, Dell could best understand their needs and efficiently provide

the most effective computing solutions to meet those needs. This direct

business model eliminates retailers that add unnecessary time and cost, or

can diminish Dell's understanding of customer expectations.

The direct model allows the company to build every system to order

and offer customers powerful, richly-configured systems at competitive

prices. Dell also introduces the latest relevant technology much more

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quickly than companies with slow-moving, indirect distribution channels,

turning over inventory in just five days on average.

The Dell Effect

For more than 20 years, Dell has revolutionized the industry to make

computing accessible to customers around the globe, including businesses,

institutional organizations and individual consumers. Because of Dell's

direct model—and the industry's response to it—information technology is

more powerful, easier to use and more affordable, giving customers the

opportunity to take advantage of powerful new tools to improve their

businesses and personal lives.

Dell has demonstrated this effect time and again as it enters new,

standardized product categories, such as network servers, workstations,

mobility products, printers and other electronic accessories. Nearly one out

of every five standards-based computer system sold in the world today is a

Dell. This global reach indicates our direct approach is relevant across

product lines, regions and customer segments.

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Marketing Strategies of Each company to attract Customers

Now a days every companies playing strategies so as to attract

customers and increase revenues and also customer base.Pent-up demand,

attractive price points and economic stability propelled PC growth. PCs are

acting as entertainment centres with TV functionality, supported by the

digital sound experience and large screen displays

Some Of The Strategies They Are Playing

Vista and Office 2007 hit the market

Microsoft has opened the doors for consumers to

purchase its latest Operating System, Windows

Vista, and Office 2007 with a grand launch

across 70 countries.

Microsoft released the latest version of its

operating system Windows Vista and Office 2007 for corporate customers

in November 2006. Now it has launched the software for the masses, i.e.

non corporate consumers. The consumer launch took place on 30th January

across 70 countries. Windows Vista is the first major Windows launch by

Microsoft since the launch of Windows XP in 2001.

These products are launched to ‘wow’ customers with features like

enhanced security, better search, improved parental control and an all new

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interface. According to Ravi Venkatesan, Chairman, Microsoft India, “This

is the launch of the decade for Microsoft and the biggest for us in India,

with the design of this product we have dealt with the security issues.” In

India, OEMs including COMPAQ, HP, Lenovo, Sahara, Wipro and Zenith

are launching Vista compatible PCs.

Windows Vista and Office 2007 will be made available to the public

in several editions. The consumer editions are Windows Vista Ultimate,

Windows Vista Home Premium, Windows Vista Home Basic and Windows

Vista Starter. Vista is being shipped in 18 languages including Hindi.

Extending the Indian language support, Microsoft will have 13 more Indian

languages including Telugu and Marathi and support for these is expected

by early 2008. Office 2007 comes in two consumer editions—Office Home

& Student 2007 and Office Basic 2007.

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On the commercial front, Munglani feels that decision cycles are still slow,

but there is a definite increase in queries and tenders. He feels that

government funded projects need to increase, and points to the recent

Andhra Pradesh schools project, which pulled in more than 5,000 units, as a

good example of what government enthusiasm for IT can do.In conclusion,

going by what the industry feels and what the numbers reveal, recovery is

definitely taking place in the industry, though caution is still the prevailing

sentiment.

However, the bottom line is that the days of super growth seem to be

over. While IDC has predicted 22.3 percent growth in 2003, not everyone in

the industry seems to be ready to join in the chorus. HP’s Sai

Chandrasekhar says that their assessment is an expectation of 10-15 percent

growth, which he feels is very realistic. “It is unlikely that the market will

return to the heady days of 30 percent growth,” he explains. Kochhar of

Skoch seconds that when he says, “We can no longer look at heady growth

rates like 40 percent or 60 percent...the market has been growing more in

single digit to low two digit growth rates.”

And that seems to be the future that India’s PC brigade faces-but well, surely

even low two digit growth rates are better than negative growth, and that’s the reason for

the cautious smiles on the faces of PC vendors. Hopefully, the next quarter will bring

even broader smiles.

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38

57.5%

8.4%

7.9%

7.0%

4.2%

3.7%

1.0% 3.5%

3.3%1.6%1.9%

HCL

Compaq

Zenith

IBM

Acer

Hewlett-Packard

Wipro

Vintron

Siemens Nixdorf

Dell

Others*

From the above graph it is clear that in Indian Hardware Industry the

COMPAQ share is highest in all branded companies. But still very high

portion about 57.5% is in favour of unbranded local companies, which is

still a challenge towards all.

The share of the unorganised sector has been falling steadily with the

fall in price of branded PCs. A recent phenomenon has been the increasing

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share of Tier 2 towns and cities in the PC sales thereby indicating increased

PC penetration into the hinterland.

Sales of notebooks have averaged around 50,000 in the past two

years. Printers have been traditionally the fastest growing segment of the

PC peripherals market. Even when PC sales were increasing by 39%,

printer sales increased by 41%. The slowdown affected printer sales too and

in 2001-02, the increase was just 1%. In that year, 836,122 printers were

sold and that included inkjet, laser and dot matrix. The momentum is

expected to pick up in 2002-03 and the printer market would grow at 8% to

reach 900,000 printers. Due to falling prices, Laser printer sales are growing

fastest.

In future, COMPAQ’s hardware sales to the institutional segment are

likely to remain stable, with sustained hardware spending by all the

verticals, especially the banking and financial services sector. Besides, in

retail hardware sales, a continued reduction of price points, facilitated in

part by the recent reduction in excise duties on PCs, is likely to reduce the

price advantage of the small assemblers, and augur well for branded PC

manufacturers like COMPAQ. In the medium term, COMPAQ’s margins,

despite its sales tax advantages, may be affected by the likely removal of

duty protection on manufactured PCs from the year 2005. With imported

PCs becoming cheaper, it may be critical for COMPAQ to establish an

alternate supply chain based on imports of finished PCs. Nonetheless, its

financial risks are mitigated by its low gearing, substantial liquid

investments and unutilised working capital limits.

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IDC declared its numbers for the Indian PC market for financial year

2005-06 today. The year recorded an impressive growth in terms of unit

shipments - the market grew 30% over financial year 2004-05 to exceed the

4.6 million-mark, according to IDC's India Quarterly PC Market Tracker,

1Q 2006, May 2006 preliminary release.

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REVISITING THE LOW-COST LAPTOP MARKET

A computer at nearly one-third of current prices is a dream for most

Indians. And yet, buyers are not holding their breath for these devices. For

experience has proved that expectations are seldom met. However, this time

around, those propagating low-cost computing solutions have taken a

different route. Chris Ann Fichardo elaborates on the difference .

The buzz is in the air again. PC manufacturers are excited. Users are

expectant. Even institutions like the IITs are enthusiastic. The reason:

India’s dream of an affordable PC (priced below Rs 10,000) is ready to hit

the market. For nearly a decade this dream has struggled to become a

reality. India Inc. has made many noteworthy attempts in the past to

introduce low-cost computing solutions, but in vain. Be it Wipro’s Janata

PC, iNabling Technologies’ e-mail device, iStation, or the much-talked

about handheld device, the Simputer—all brilliant concepts that have not

quite made it commercially yet.

The company netcore is doing groundbreaking work to make possible

the Rs 5,000 PC (5KPC), says that if the price point of a PC comes down

between Rs 5,000 to 10,000 per user, India has the ability to absorb 10-20

million PCs a year for the next several years. This potential gains further

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significance when one realises that the present market size is just two

million PCs a year! In the last 20 years the installed base has barely crossed

six million PCs in India.

According to Richard Brown, director for International Marketing at

VIA attributes this sudden interest by vendors to the "real growth potential"

of the low-cost PC market. "I remember five to seven years ago when the

first $1,000 PC appeared (introduced by Compaq), people wondered if the

price point was for real. And since then there has been a continuous push

down in the price points for PCs, which is a sign of commoditisation of the

industry. For a long time the industry has resisted moving to lower price

points, and now they are actually seeing that there is demand in that space

and they are buying into it," he says.

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CHANGING TRENDS IN LAPTOP MARKET

With prices of laptops being slashed, the education sector is expected

to see a high demand for laptops.

Consumers are shifting their focus of laptop computing from an

average system to one that is closer to a high-end system and

upwards.

The need for the most powerful multimedia laptops is increasing.

Linux might gain ground in the government and defence sectors.

Customers, both in the consumer as well as in the commercial space

will demand better service levels from vendors.

Service and support is going to be a critical aspect of vendor strategy.

Depreciation period of IT products should be reduced to further boost

growth.

The laptop space will see more and more entertainment-oriented

features getting integrated into the normal PC.

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The enterprise space will witness more stress on security, TCO,

manageability and multiple levels of redundancy, among others

Companies, which will offer affordable innovation will gain market

share.

Unicode will drive laptop penetration into rural markets

SME will continue to be a major segment.

The industry has standardised on 80 GB HDDs.

Trends Expected In 2009

In the future, with more duty cuts expected, analysts believe branded

laptop players will gain further against assembled players. Retail may

get a renewed thrust. Observes Raj Saraf, Chairman and Managing

Director, Zenith Computers, “We have1300 retail outlets today,

which we hope to grow to 15000 by the end of 2009.”

While vendors are bundling in Linux to bring down costs, analysts

see desktop Linux confined to the government and education sector.

Linux on the desktop is unlikely to make inroads in the enterprise.

Prices of computers have been falling rapidly, but vendors do not

think prices of laptops will fall significantly in 2009.

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While 2007 saw strong demand emerging from select sectors such as

the government and BPO outfits, 2008 could be relatively flat as most

BPO firms are in the process of consolidation and not growth.

LAPTOP MARKET: TOP TRENDS

Laptop market revival may happen in second half of this year. Post-Budget

laptop prices will remain constant or rise marginally. Indian brands will

survive, but they need to decide on an unambiguous competitive pitch.

Thrust into the B & C class towns will be aggressive, by Indian and MNC

players alike. The notebook market will show significant gains in 2002-03.

If you want to know what the future holds for the Indian PC industry, the

one fact you cannot afford to ignore is the current slowdown not just falling

growth, or a gentle trough, but the horrible spectre of negative growth.

The near panic the industry witnessed in the wake of this terrible time was

reflected in the price slashes and bundling offers anything to kick start

stagnating sales graphs was acceptable. And that took the laptop to almost

commodity status in India.

But then, that’s history. And in business, history is not what sells;

promises of a rosier future do. According to industry association MAIT’s

president Vinnie Mehta, sales have picked up in the JFM quarter, which is

traditionally a high sales quarter, and as of now, they’re hoping that this will

be a sustained phenomenon in spite of a lacklustre Budget that did almost

nothing to push up demand for laptops.

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PRICES DO AN ABOUT-TURN

Immediately after this year’s Budget, most laptop vendors said laptop prices

would remain constant, and some even pointed out that prices would rise,

thanks to increasing memory prices. That should be one of the key

differentiators between last year and the financial year ahead laptop prices

are not likely to come down, and in all probability, will actually see

marginal rises.

Says Vasu Srinivas of IDC India, “While the initial response to the

slowdown was to slash prices, when it began to hurt, laptop vendors began

to take a profitability approach. They are now seeking out the more

profitable deals and aiming for better prices with lower volumes.”

Another factor that will contribute to stable prices is the move by the big

distributors to cut credit periods down the line from 30 to 15 days. This

move, coming in the wake of big defaults among IT channels, will

discourage speculative and rash pricing and margin policies that result in

price wars the industry can ill afford.

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TRIUMPH OF THE MNC BRIGADE

In recent times, one of the most important trends in the Indian laptop

business is the sight of MNC vendors turning leaders. Yes, COMPAQ

Infosystems, the leader in the desktop segment, is as Indian as they come,

and the company’s leadership position seems in no immediate danger, but

it’s not insurmountable either.

All it will take is the HP-Compaq deal going through in the United

States, and COMPAQ will become No 2 to an MNC behemoth that will

then control almost double of COMPAQ’s market share, which currently

stands at 8.6 percent, according to George Paul, head-marketing, COMPAQ

Infosystems. While everyone admits that the market share of MNC brands

has gone up, and mostly at the expense of Indian brands, this issue

generates a lot of heat and passionate arguments.

BIG BUYERS MATTER

While the move to B & C class cities attracted attention, the biggest buyers

of PCs pretty much remained constant, and they’re expected to continue to

be the saviours of the beleaguered PC industry this year too. The honours

go to the government both at the Centre and the states, and the banking and

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financial sector mainly PSU banks. Another segment expected to contribute

significantly to laptop buying this year is the telecom sector.

OUTLOOK

When will the good times start rolling again? The pundits have

differing opinions. IDC India says the laptop industry is expected to grow

by 5.1 percent in 2002, and adds that laptop buying is expected to revive in

2003, when a growth rate of 20 percent is forecasted. Kochhar of Skoch

says this year will see some revival, though he warns that heady growth

rates will not return without policy measures like 100 percent depreciation

from the government. MAIT is hoping that the slight upturn in the JFM

quarter is a portend of things to come, even though it revised industry sales

projections for 2001-02 downwards from 2.45 million units to 1.65 million

units.

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THE DECISION MAKING PROCESS

Decision makers, who are used to depending on their past

experiences, must make decisions and take actions in the rapidly changing

world we face today. In this turbulent environment, the ability to

successfully view the current situation through the traditional "good

judgment" viewpoint is weakened through increasing external noise (a

multitude of information sources on multiple topics) and changing.

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STRENGTHS:

a) Global Presence: • Its collaborations and joint ventures with international companies such as Perot System, and partnership with world leaders like Ericsson, Toshiba, Nokia, Oracle and Microsoft, enable it to bring the best technology available world wide to its consumers.• 24 locations in 16 countries.

b) Fast paced and flexible work culture which provides its employees autonomy to accomplish the task without much pressure from the higher authorities. Thus, employees are motivated to give their best to the organization.

c) The core strength of COMPAQ is the talent and innovativeness of its people which enables it to provide the “right solution at the right time.”

d) The mass markets handled through a chain of dealers, resellers and retailers which helps bring technology usage closer to the individual. It has very strong distribution network.

e) Its pool of competencies : Hardware, Software, Training, Networking, Telecom and System Integration.

f) Ability to understand customer's business and offer right technology.

g) Long standing relationship with customers.

h) Pan India support & service infrastructure.

i) Best-value-for-money offerings.

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WEAKNESSES:

a) After sales service.b) Less promotional campaigns.

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OPPORTUNITIES:

a) IT industry booming at a rate of 45% every year.

b) Increasing consumer awareness about IT and its use.

c) Tremendous untapped potential of IT products in India.

d) Increasing competition.

e) Tie ups with various MNCs enable to extract their core

competencies.

THREATS:

a) Local assemblers are biggest menace for the company.

b) Entry of MNCs i.e. IBM, Compaq giving direct competition.

c) Govt. instability has a long term repercussions affecting

company’s policies & its growth.

d) Technological shift as a result of research & development.

Daily new technologies are emerging.

Concluding the S.W.O.T. analysis in words that prosperity lies ahead

for COMPAQ. In order to retain its position as India’s No. 1 IT

conglomerate, it has to come out with the state of art as well as futuristic

technologies to its consumers well before time.

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FINDINGS & LIMITATIONS

Every project has some limitations even the researcher came across some

limitations while working on the project which made the analysis a little

inappropriate at times. Some of the basic limitations faced during the

research are listed below:

Only limited number of authorized, companies and other areas where

it has been found 55 players was covered in the study.

Most of the research was based on cold calls, so then visited many

places i.e. authorized and local areas and where it had not responded

much.

There was a bias on the part of the respondents.

Companies that were contacted through telephone at times did not

give correct information to the researcher.

The IT manager or the person heading the IT Department did not

have the rights to give the authorized official information to people

other then the members of the official itself and the high officials.

At times there was a problem of non response from the hospitals,

companies and other authorized and unauthorized areas which

affected the result of the project being done by the researcher.

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COMPAQ is having large number of channel partners but it is not

supporting & taking care all of them equally which results in increasing

discontentment among new channel partners because its not possible for

company to support all of them equally. Company should take some

positive action against it.

Company executive should visit dealers on regular basis.

They Should pay proper attention towards checking of various

components of PC before end user delivery. Otherwise it tends towards

defame of brand name in comparison to rivals.

Need to expend customer care center as the consumer base of

COMPAQ is increasing with tremendously fast pace.

Proper attention should be paid for advertisement planning otherwise it

may lead to problem for dealer as well as for company.

Company should make policy for fixed end user price for all dealers

so that fair game will be played & dealer would not to compromise

on their margin.

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CONCLUSION

Marketing is a very crucial activity in every business organization. Every

product produced within an industry has to be marketed other wise it will

remain as unsold stock, which will be of no value. I have realized this fact

after completion of my summer training project. Despite of various

difficulties and limitations faced during my summer training project on the

topic “MARKET SHARE OF COMPAQ LAPTOPS”. I have tried my

level best to find out the most relevant information for the organization to

complete the assignment that was given to me. After completion of my

summer training project I have gained several experiences in the field or

sales marketing. I have got the opportunity to meet various people, which

fluctuate in different situation and time. This summer training project has

given me the opportunity to have first experience in the corporate world.

Theoretical knowledge of a person remains dormant until it is used and

tested in the practical life. This market survey has given to me the chance to

apply my theoretical knowledge that I have acquired in my classroom to the

real business world. I have completed my market survey project in which

are involved in its successful completion. In spite of few limitations and

hindrance in the market survey project I found that the work was a

challenge and fruitful. It gives enough knowledge about the laptop market

and the distribution process undertaken by an organization.

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QUESTIONNAIRE

Name

____________________________________

Designation

____________________________________

Address

____________________________________

Contact No.

____________________________________

1. Do you use laptop for your business purpose?a.) Yes b.) No

2. What type of laptop do you use?a.) Brandedb.) Assembled

3. What brand of laptops do you use?a.) HPb.) COMPAQc.) ACERd.) Others

4. What is the number of installed desktops?a.) <15b.) 15-50c.) 50-75d.) 75-200e.) 200-500

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5. What is the number of used servers?a.) 1b.) 2c.) 3-5d.) >5

6. What is the number of installed laptops?a.) 1-5b.) 5-15c.) 15-30d.) >30

7. What is the brand used for laptops?a.) COMPAQb.) Toshibac.) Lenovod.) Others

8. Are you facing any problem with current used product line?a.) Yesb.) Noc.) Not yet

11. How do you find the COMPAQ products?

a.) OK b.) Good c.) Satisfactory d.) Outstanding e.) Not tried yet

12. Do you want to know more about COMPAQ products?a.) Yesb.) No

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BIBLIOGRAPHYBIBLIOGRAPHY

BOOK:

AUTHOR: PHILIP-KOTLER

TITLE: Marketing Management

PLACE OF PUBLICATION: Delhi

PUBLISHER: Tata McGraw, Hills Publishing co. ltd.

MAGAZINES / JOURNALS / NEWSPAPERS:

♦ Business World

♦ Business Today

♦ The Times of India

WEBSITES :

♦ www.Compaq.com

♦ www.google.com

♦ www.hp.com

♦ www.saharacomputer.com

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♦ www.dell.com

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